Peering into California's Stem Cell Future: A Vision for Next November if Voters Give Go Ahead

So what happens on Nov. 4 if California voters approve $5.5 billion more for the state's 15-year-old stem cell research program?

Well, as someone famously has said -- sort of -- there is a plan for that. And its essence will be presented tomorrow morning online for the entire world to see and discuss.

Nov. 4 is the day after the election in which voters will say yea or nay to the initiative to refinance the California Institute for Regenerative Medicine (CIRM), which needs lots of money to keep its doors open in Oakland.

Maria Millan, CEO of CIRM, and its lean team of 33 have been working hard on what might be called CIRM 3.0 -- CIRM 2.0 being its current state. She has prepared 16 pages of presentations that are now available for viewing on the CIRM website.

Millan will formally offer them up tomorrow morning at a public meeting of the CIRM governing board that will be on YouTube and audiocast beginning at 9 a.m. PDT.  Instructions for participating are on the agenda, including how to speak directly to all those logged on, how to raise questions and make suggestions.

As usual the slides are an outline -- not a fully fleshed-out proposal -- which CIRM's 29 directors may change or reject. But it is likely that the essential elements of the proposal will move forward . The concept plan is also likely to affect the professional lives of the few thousand folks folks working in stem cell research in California.

What is more important is the measure of the success of the proposal, which basically is a  development effort aimed at aggressively pushing stem cell therapies into the marketplace. The agency currently lists 63 clinical trials that it is assisting, an area that is likely to become more important if the initiative passes.

At the beginning of the presentation, Millan asks the question, "Where do we want to be?"

Her three-point response is:

• "Accelerate the development of near term and future innovative regenerative medicine approaches to deliver effective cures and treatments

• "Expand therapeutic delivery and equitable access to patients with unmet medical needs 

• "Partner with key stakeholders and structure internal operations to accomplish the above"

Californians will hear more tomorrow about how CIRM might use $5.5 billion over the next 10 to 15 years. Then CIRM will once again have to start looking for more cash. The new initiative provides no funding beyond that time frame.

Calfornia's Stem Cell Pie for 2020: State Agency to Slice Up Nearly Final Millions Next Week

It ain't over yet -- at least that's the word from what could be deemed the financial center of stem cell research in California.

The governing board of the California stem cell agency is scheduled to meet Feb. 6 to allocate unspecified additional millions for stem cell research and peer down the road that awaits it beginning Nov. 4 of this year.

That is the day after California voters are expected to deliver their judgment on whether the California Institute for Regenerative Medicine (CIRM), as the agency is formally known, should continue and receive an additional $5.5 billion.

The agency is running out of money. Its initial $3 billion is now down to $27 million for awards. A ballot initiative to give the agency the additional billions is expected to be on the ballot this fall, Nov. 3 to be precise.

But in just 10 days, the CIRM board will reveal the amount of cash that has been recovered from research awards that failed to meet milestones during 2019. The board is scheduled to make decisions on how that money, which is likely to run into tens of millions, is to be allocated during the remainder of this year.

Also on the agenda is a three-word topic: "strategic plan themes."  This is likely to involve possible directions of the agency should it receive additional funding from the ballot initiative. That proposed measure substantially expands the scope of the agency and specifies it move into in certain new areas, including attempting to assure the affordability of agency-financed therapies whose costs could run upwards of $2 million.

The agenda includes an update on most major programs involving CIRM, information that will come widely into play as the next fall's election receives more attention.

The meeting will be based at CIRM's headquarters in Oakland. But it will also be available electronically at a number of other public locations throughout California and via the Internet. Members of the public will be able to comment and ask questions through the Internet. Details are available on the agenda. 

CEO Millan on the Prospects for California's $3 Billion Stem Cell Research Effort

Maria Millan, the president of the $3 billion California stem cell agency, this week discussed the future of the nearly 13-year-old effort, which expects to run out of cash for new awards in 2020.

Her remarks are contained in a Q&A interview on RegMedNet, "a networking site that unites all members of the diverse regenerative medicine community," according to a statement on the site.  

The piece contains no big surprises but is worth examining if you want to get a sense of her background and where she is headed. Here are two excerpts.

Question: "What will happen once CIRM has given out all $3 billion allocated to it by Proposition 71?"

Answer: "We are working with our board to pursue sustainability options to ensure that the products of the Proposition 71 investment have the best chance of reaching the patients.  CIRM has played an essential role in growing the stem cell/regenerative medicine field by bringing in the critical mass of resources, top notch researchers, rigorous basic and translational research and building the most robust late development and clinical stage portfolio to accelerate novel treatments to patients with unmet medical needs. With the CIRM 2.0 processes that drove operational excellence and acceleration, there is incredible potential to build upon the recent early successes that led to projects that are nearing FDA marketing approval and to drive more of these successes to the benefit of healthcare and patients."

Question: "What are your plans for CIRM over the next few years?" 

Answer: "We are fully committed and motivated to executing on the 5 year strategic plan that we launched in January 2016. When we proposed these strategic goals, they were 'stretch' goals and now it looks like we will achieve these goals. This strategic plan is driven by our mission 'to accelerate stem cell treatments to patients with unmet medical needs.'"

California's Stem Cell Research Spending Up for Review Next Week

If you are interested in how the state of California is going to spend its final $800 million or so on stem cell research, you should catch a key meeting next Tuesday in Oakland, which also can be heard online.

The session involves the 29-member, governing board of the $3 billion California Institute for Regenerative Medicine (CIRM), as the state stem cell agency is formally known.

The agency was created by California voters in 2004 with voters' expectation that stem cell therapies were all but just around the corner. So far, no therapies have been developed by the agency that are available for widespread use.

Nonetheless, the agency, which runs out of money in 2020, is pushing hard. It has more than 20 clinical trials underway, which is the last step in bringing a therapy to market. However, those trials can take years with no guarantee that a proposed product will emerge successfully.

On tap on Tuesday will be a look at the agency's research plans for the next three years with a review of how it has performed so far in 2016. The agency's proposal for research spending in 2017 is likely to have a significant impact on the hundreds of stem cell researchers in California. The proposal is not yet available online, however, with only two business days left before the meeting.

CIRM is also hinting that there will be some surprises at the meeting, but it is unlikely that a product announcement will be forthcoming.

Additionally on tap are applications for a total of $14.9 million for two early-stage clinical trials. One is for $6.7 million (CLIN2-09439) to test using stem cells and T cells to eliminate the life-long need for immunosuppresive drugs by kidney transplant recipients. The other (CLIN2-09698) is for $8.3 million for a mid-stage trial (2b) for a therapy for retinitis pigmentosa.

The applications were approved for funding by the agency's grant reviewers, who meet behind closed doors and do not publicly disclose their economic or professional interests. Ratification of the reviewer decisions is a formality for the agency. although the names of the recipients are not generally disclosed prior to board action.

The board is expected to re-elect Jonathan Thomas as chairman of the panel. Thomas was elected to the position in 2011. He has sent a  two-page letter to the board detailing his work during the last five years. Also scheduled to be re-elected is Art Torres as vice chairman.

Thomas receives $400,000 annually for his "80 percent effort" in the part-time position. Torres, a former state lawmaker, receives $225,000, also for an "80 percent effort."

Instructions for listening to the meeting online can be found on the agenda. In addition to main meeting site in Oakland, public telephonic locations exist in San Diego and La Jolla. Specific addresses can be found on the agenda.

QuintilesIMS Driving $30 Million, California, Stem-Cell Pitching Machine

(Editor's note: The following article by yours truly appeared in The Sacramento Bee yesterday afternoon.j

BY DAVID JENSEN

Special to The Bee

The California stem cell agency on Wednesday completed creation of a $30 million effort to dramatically speed approval of stem cell therapies and establish the Golden State globally in the much-heralded regenerative medicine field.

Dubbed the “pitching machine,” the two-part program is designed to pick up where basic stem cell research leaves off and to accelerate it through the all-important clinical trials involving humans. Such trials are required prior to widespread use of a therapy by the public and generally take years.

With no debate, no questions and no discussion Wednesday, the governing board of the stem cell agency unanimously approved a $15 million award to QuintilesIMS in San Diego to help move basic research into clinical trials. The effective decision, however, was made Oct. 4 during a closed-door meeting of the agency’s scientific reviewers, who gave the proposal a score of 89 out of 100.

The other half of the pitching machine was an additional $15 million award to Quintiles, which formally began operations this month. Quintiles is a publicly traded, multinational firm based in Durham, N.C., that deals with “information and technology solutions” in health care.

C. Randal Mills, president of the $3 billion stem cell agency officially known as the California Institute for Regenerative Medicine, said the pitching machine is likely to be the most significant achievement of the state’s 12-year-old research effort.

CIRM’s contracts with Quintiles call for the $30 million to be spent in California.

California voters created the state’s stem cell agency in 2004 following a ballot initiative in which voters were told that stem cell cures were nearly at hand. The agency has yet to finance research that has produced a therapy that is available for widespread use.

Quintiles’ responsibilities will include pharmacology and toxicology studies along with manufacturing stem cell and gene-modified stem cell products. The company will also provide clinical trial operations and management services as well as data management, and biostatistical and analytical services.

CIRM’s contracts with Quintiles are for five years. The effort will also feed into the agency’s Alpha Clinics, a $34 million program to intensify focus on stem cell treatments and to contribute to California’s global position in the stem cell field.

The agency said Wednesday’s action will create “the first center in the world designed specifically to overcome the unique challenge of manufacturing, safety testing and other activities needed to successfully apply” to start a stem cell clinical trial. One clinical trial that launched in 2010 required submission of 22,000 pages of information to the FDA.

CIRM said Quintiles’ expertise will create “a standardized, uniform approach that best meets the needs of the FDA, making it easier for the agency to evaluate projects in a timely manner.”

Mills said that with the $30 million Quintiles deal, “we are doing a lot more than just funding research. We have created an entire infrastructure, unique to California, that will help us increase the volume, speed and quality of projects moving into clinical trials.”

CIRM is involved in 19 active clinical trials. It is projecting its participation in about 50 more before 2020, when its funding is scheduled to run out. No additional source of funding has been secured.

(Editor's note: On Oct. 21, the agency said its list of active clinical trials had now reached 22. The agency's web page on the list of clinical trials should be updated soon. )

Read more here: http://www.sacbee.com/news/local/article109286937.html#storylink=cpy

Risk and Reward from California's $150 Million Plan to Create a Stem Cell Company

The California stem cell agency has identified a number of risks and benefits that are associated with its $150 million plan to create a public-private company to advance stem cell therapies. 

Risks and rewards were laid out in its spending/strategic plan for the next five years, which was approved by directors last December. The discussion of risks in the plan and other proposals as well is a hallmark of the administration of CIRM CEO Randy Mills, who joined the agency about two years ago. Prior to his arrival, the agency's staff did not formally offer risk assessments for its proposals. 

The $150 million proposal has been dubbed ATP3 -- short for Accelerating Therapeutics through Public-Private Partnerships. The financing for the deal is up for approval tomorrow by CIRM directors. 

CIRM's List of Benefits From ATP3

"The aggregation of a basket of otherwise unpartnered CIRM projects offers the successful applicant 'multiple shots on goal.' This increases the probability of successfully developing and commercializing a stem cell treatment and makes significant industry investment in stem cell technology more attractive."  

Benefits to researchers: "continued funding for the advancement of their CIRM
project"

Benefits to universities: "demand creation for the out-licensing of CIRM-funded
technologies with a greater opportunity to achieve a financial return due to the aggregation of risk"

Benefits to citizens of California: "the creation of an industrial stem cell treatment powerhouse that expands the tax base, adds high quality jobs, and increases the likelihood of the commercialization of stem cell treatments for patients with unmet needs"

A CIRM memo last week also identified possible financial benefits to the state or CIRM via royalties and/or sale of the state's interest in the company. 

CIRM's Evaluation of Risk

"Investors may be uninterested in stem cell treatments" is what the agency's strategic plan said in December 2015.

It continued:

"To date, venture capital and the pharma and biotech sectors have been unwilling
to make substantial investments in stem cell research. The lack of a track record of
success, coupled with the regulatory uncertainty discussed above, have dissuaded
them from making a substantial commitment to the field. This has exacerbated the
challenges posed by the so-called 'valley of death' between discovery and clinical
translation where funding has traditionally been scarce.

"Although California voters made a substantial investment in CIRM when they approved Prop. 71, CIRM, by itself, does not have the funding necessary to translate the many discoveries made
by researchers it has funded into treatments. Indeed, the costs of developing a single drug are estimated to be $2.6 billion.

"For CIRM to succeed in its mission, CIRM must partner with other investors to bring treatments to market and deliver them to patients. CIRM plans to address this concern by continuing to champion CIRM - funded project to potential partners and investors and by creating a demand for CIRM -funded projects through public-private partnership designed to accelerate treatment development, described in section 7 of this plan."

Other general risks are identified in three pages of risk laid out in the strategic plan, including insufficient "meritorious treatments," safety concerns, FDA reluctance and inadequate health benefits from stem cell treatments.

Excerpts from the Birth of ATP3: California's $150 Million Plan for a Stem Cell Company

Here are excerpts from the transcript of the California stem cell agency meeting Dec. 17, 2015, at which its directors approved the concept for a $150 million public-private partnership. The concept was part of the agency's spending plan for the next five years. Details of the financing and term sheet were disclosed last week and are scheduled to be approved a meeting on Friday.

Randy Mills, president of California Institute for Regenerative Medicine (CIRM), as the agency is formally known:

"We have a lot of things in this (strategic) plan that are new for a funding agency to attempt, but this one (ATP3) stands out even for this plan. Here the concept is that we have a whole bunch of technology. We have 300 or so different programs at CIRM. As we said, only 8 percent of our academic programs currently have industry partners. So how do we fix that? 

"We thought about a number of different ways, but one of the ways is just to go directly and do it. We thought, well, what would happen if we put out a call for basically the creation of a new entity or a new company that would be a California-based company that could take these technologies and aggregate them and focus on developing and commercializing stem cell-specific technologies?

"So the idea is here we would put out a call that would require a successful applicant to put together a business plan that would describe what types of technologies from our portfolio that they would like to aggregate and the synergies associated with those, a great management team that could actually make that happen in a successful way, and then, very importantly, a tremendous amount of upfront capital that they're going to commit.  

"I think we had in this concept $75 million in upfront capital that they're going to commit into taking these technologies and driving them forward. Then we would then partner with them on actually a very efficient basis to help fund some of that research going forward. Again, the idea being what we would have at the end is an entity, basically a powerhouse in the state of California that have these technologies that they're actively commercializing. It would be an outflow for new technologies that are coming out of CIRM that need an industry home and obviously create jobs and expand the tax base for California. And then, lastly, but most importantly, be a vehicle for getting the final span of this bridge where we go from late stage research actually through commercialization so patients can benefit from them. Again, Dr. Millan is going to talk more about this. I don't want to completely steal her thunder, but it's a cool part.”

Maria Millan, senior director of medical affairs, who spoke later:

“We have identified and we know as a field that there is a lack of industry pull for stem cell therapeutics. Although CIRM has invested approximately $2 billion so far in developing a portfolio of approximately 300 technologies, we know that only 6 percent of CIRM's academic projects have been licensed by industry. And in discussions with the University of California system, we know that of the 3,400 technologies being marketed, we're not even talking about all technologies, but just those that are being actively marketed, less than 2 percent of those are stem cell programs.

"So we are proposing to the board today an initiative, the ATP3 initiative, as a means of engaging industry by creating an opportunity for top-tiered leadership and management teams to come in and competitively be evaluated in their ability to form an entity which would aggregate CIRM's most promising technologies. By aggregation, it would offer multiple shots on goal on these product development candidates which increases the probability of success, so called de-risking the proposition. And what we anticipate is this would make it more significantly palatable and actually incentivize industry to come in in partnership. In addition, what's baked into this initiative is that CIRM would leverage its capacities in terms of administrative review structure and advisors to help this entity come up with the best possible portfolio. And CIRM would continue to be involved by funding the development of these in-licensed technologies.

"So as a general structure, the accelerating therapies to public private partnership, ATP3, the major goal of this is to get the CIRM-funded stem cell technology candidates to the patients, get the technologies to the patients, and how do we do that? We pull industry in, we get a private partner through this competitive process who will in-license, develop and drive toward commercialization the aggregated portfolio. And as I just stated, CIRM will be actively involved in this and choosing and enabling the licensing and in helping to fund these program's developments.

"In addition, the researchers would have continued funding for the advancements of their project. just to back up a bit, when these in-licensed programs come in, they come in with current funding for these programs to go to a certain value inflection point. if they're chosen by CIRM and by the ATP3 awardee to come into their portfolio, then the project would get additional funding. For universities, by design of this initiative, there would be a demand creation for out-licensing cirm-funded technologies and, therefore, a greater opportunity for financial return which then could go on to fund future projects and efforts. And for citizens of California, as Dr. Mills stated, this is an opportunity to create a therapeutic powerhouse that increases the likelihood of getting stem cell therapeutics to the patients.

"The private partner or the awardee, the applicant, could be an established company, a spin-off, or a new company altogether that's formed by a team of professionals that have come out of either pharma, biotech, or could be investors. They will be judged on and will propose an exceptional business plan to aggregate these technologies, give the rationale for this, propose how this will create value and bring return to the stakeholders. And they would come in with a leadership team that would be judged on their track record and their strength that they bring to the initiative and the likelihood they'll be able to execute on the business plan and bring about the goals of this initiative. The entity will be required to come in with significant investment upfront and utilize this to execute on the business plan while CIRM will fund the support of the development of the in-licensed projects.

"The CIRM award is anticipated to be approximately $75 million of funding over a five-year period. It could be in the form of a loan, but the applicant, the awardee, would be required to match the total award amount, regardless of how much of the loan they take on, dollar for dollar upfront. The awardee would also be required to comply with the pricing access and march-in provisions of CIRM's IP regulations and to provide the licensor of the CIRM projects with the right of first refusal should they decide to shelf or cease development of that particular technology." 

$150 Million 'Powerhouse:' California Discloses Financing Details on New Stem Cell Company

CIRM graphic

Highlights
A California first
De-risking therapy development
Selling off the notes
Possible IPO

California's stem cell agency this week unveiled details of a far-reaching and unique proposal to create a $150 million, public-private company to speed commercialization of stem cell therapies and bring them into widespread use.

The proposal by the California Institute for Regenerative Medicine(CIRM), as the $3 billion agency is formally known, is believed to be a first in California history in terms of its size and scientific scope. It goes well beyond any such stem cell efforts involving other states.

The agency hopes to lure business into its stem cell game with a $75 million loan with invitingly lenient terms. CIRM's private partner would have to repay only 50 cents on each dollar of the loan. However, the partner would be required to match the loan with its own $75 million contribution.

Randy Mills, president of the agency, says the goal is to create a "powerhouse" company that would step up development of stem cell therapies that have been slow to emerge. It would "de-risk" the effort because of the state contribution.  The CIRM proposal also envisions the possibility of the enterprise issuing publicly traded stock, which could mean huge profits for initial investors, such as CIRM would be.

The project -- dubbed ATP3 -- comes before a special panel of CIRM's governing board directors next Friday at a meeting in Oakland. The panel is expected to review and approve a proposed term sheet for the financing so that the agency can post a request for applications very soon.

The meeting is public. The agency normally also has teleconference locations elsewhere in the state available for public participation along with a listen-only, toll-free audiocast.

In a memo to the committee, Neil Littman, the agency's business development officer, said,

"The overarching objective of ATP3 is to encourage industry involvement in cell therapy through the creation of public-private partnership that advances existing high quality CIRM-funded stem cell technologies toward commercialization. 

"Our main objective in structuring the terms of the award was to strike a balance between ensuring a financial return to CIRM and thus the citizens of California while at the same time ensuring the attractiveness of the award to encourage industry participation.... Although CIRM is not a venture capital firm or a traditional investor and is willing to bear significantly higher levels risk, the risk should be commensurate with the potential reward. Thus, if we are successful in creating a valuable stem cell enterprise in the State of California, it is appropriate that CIRM and the citizens of California participate in the financial upside."

The loan would be issued in the form of convertible notes that the agency could convert to stock if that seems more profitable than a loan. Littman wrote,

"This award is unique, and provides for the establishment of a new, for-profit California-based entity, which if successful, may command a significant future valuation."

Littman continued,

"A convertible note financing is commonplace in the biotechnology and venture capital community, and allows the note holder to participate in the upside should the issuer become a valuable entity. On the downside, the note holder is protected by the debt portion of the instrument, and could choose not to convert should the issuer perform poorly."

Structuring the investment as a convertible loan prevents the agency from violating a law that prohibits the state from owning stock in a private company.  The agency could sell the note to another investor that could be willing to pay more than the amount owed on the note because it can be converted to stock.

The proposed terms also stipulate that the loan would be issued in three separate notes. Each note could be transferred or sold separately, providing more opportunities for the state to profit.

The plan to create the new company also strikes at another issue that CIRM's Mills has spoken about repeatedly -- the reluctance of private companies and investors to engage in stem cell therapy development. In December, he told directors that only about 6 percent of the CIRM-financed research programs (totaling roughly $2 billion) has private partners. The reason, he said, is that the private sector is put off by the financial risks involved in stem cell development.

The new effort would also allow the private partner to pick through the CIRM portfolio to select research that would be potentially profitable -- excluding research that already has a private partner.

Here are links to the presentation slides on the proposal, Littman's memo and the proposed term sheet. For earlier items on the initial discussion of the plan last December, see here and here.

Watch for more coverage of this plan next week here on the California Stem Cell Report.

Ten Days in March: Is the $3 Billion California Stem Cell Agency Measuring Up?

Highlights

'Success metrics'

Next week's board meeting

Discouraging public attendance

But amply open in many ways

One of the more admirable aspects of the California stem cell agency’s plan for spending its last $900 million is its attention to careful measurement of the agency’s own performance.

The “success metrics” are tucked away at the end of the agency’s new, 47-page strategic plan. They lay out the criteria for determining how well each team at the agency is doing. The metrics range from the number of conflict of interest appeals to the number of clinical trials completed at Alpha clinics. Based on decades of experience with state agencies, the California Stem Cell Report can attest that such attention to performance is rare among state departments.

The agency's measurements also include the “number of board meeting documents posted with ten-day lead time.” Which is where the March 16 meeting of the governing board of the stem cell agency comes in.

On Saturday, the agency posted on its Web site the agenda for the meeting, a good 11 days ahead of the session in Millbrae, near San Francisco International Airport. The agency plans to give away millions of dollars, perhaps tens of millions. It will review the status of its ambitious and risky clinical trial program, which has seen a sharp upsurge in the last year or two. At least that is what can be deduced from the cryptic agenda items, the longest of which consists of only 26 words.

Total missing, as of this writing, are any documents supplying the details essential for understanding what the agency is actually doing.

The board meetings are the single most important public events of the agency. The agency professes to want to see greater public turnout at the sessions. But without adequate notice and some sort of meaningful information, the public, stem cell firms, scientists and patient advocates cannot make plans to attend the meetings even if they might have a deep impact on their lives.

On Feb. 9, Kevin McCormack wrote on the agency's blog about a CIRM meeting dealing with gene editing. He said,

“(Bioethicist) Alta Charo said this is not just a question for scientists, but something that could potentially affect everyone and so there is a real need to engage as many groups as possible in discussing it

"‘How and to what extent do you involve patient advocates, members of the disability rights community and social justice community – racial or economic or geographic.  This is why we need these broader conversations, so we include all perspectives as we attempt to draw up guidelines and rules and regulations.’”

Those sentiments pretty much apply to all that the agency does. It is spending $6 billion of California taxpayers’ money, including interest, on research that is yet to produce a commercial therapy, despite the facile promises of the ballot campaign that created it in 2004. It is financing experiments in areas that are new to medicine, some of which involve serious risk and ethical considerations.

All of which might seem to be issues that would engage many persons and enterprises. But the best way to discourage involvement by those not embedded in the agency is to withhold information until it is too late to respond. If interested parties don’t know what is going on, how can they offer suggestions and criticism, some of which might be useful and help the agency succeed in its endeavors? Not to mention helping to build support for continued funding beyond 2020, when the agency expects to run out of cash.

Additionally, the agency basically hides the schedule of its public meetings on its Web site. They are virtually invisible on the agency’s home page, buried at the bottom in teeny lettering under a heading of “about CIRM” -- one of 11 subjects such as “mission” and “history.”

In many ways, CIRM is more than amply open and transparent. Its board meetings are audiocast on the Internet and by phone. Its committee sessions are now available live online as well, an improvement that began during the last few months. Transcripts of the sessions are also available online, albeit sometimes months after the sessions.

The CIRM Web site is laden with a variety of material. The agency’s excellent blog, The Stem Cellar, produces daily reports that chronicle CIRM affairs as well as research developments elsewhere.  Interested persons can sign up for email alerts on various CIRM matters. Eventually, most of background information on board meeting agendas is posted online, although sometimes only a day or two ahead of the session.

Nonetheless, CIRM can and should do a better job of telling California what its governing board is up to and what the agency is thinking and doing. One key and long neglected tool is to provide more detailed information -- well in advance -- about the issues that come before the 29-member board that hands out the cash and establishes the priorities for one of the most ambitious stem cell programs in the world.

Link to CIRM's News Release on Its New Spending Plan

The California stem cell agency this afternoon posted a news release about his new, $890 million plan for the next year, describing it as bold, innovative and ambitious.

Here is a link to what the agency has to say.

Fifty New Clinical Trials, a $150 Million Partnership and Much More: California's Coming Stem Cell 'Powerhouse'

Highlights

50 new clinical trials

$150 million public-private partnership

"Long overdue," says venture capitalist
$30 million end plan

LOS ANGELES -- Directors of the California stem cell agency this morning approved an $890 million plan for the next five years as it surges forward with a risky and ambitious effort to build an “industrial stem cell therapeutic powerhouse” in the Golden State.

The agency proposes 50 new clinical trials on top of 15 already underway. Next year it expects to set up a $150 million partnership with private investors to turn research into cures. Investors would have first pick of the best research that CIRM has to offer that currently lacks a partner. 

Other ventures and goals for what could be the agency's last five years of life include:

• Introduction of 50 new therapeutic or device candidates into development
• Working to create a more favorable federal regulatory environment
• Reduction by 50 percent the time it takes basic research to move into a clinical trial
• Creation of two centers at $15 million each to assist in much of the "backroom" work needed for clinical trials
• Creation of an online, hook-up center for researchers looking for collaborators to advance their work

Directors of the agency, formally known as the California Institute 71 for Regenerative Medicine (CIRM), approved the plan unanimously at a meeting here. (Here is a link to its press release.)

Arlene Chiu, former director of CIRM's scientific programs and now with the City of Hope, told the agency board that the plan was audacious and bold. CIRM board member Sherry Lansing, former chair of the UC board of regents, praised the plan's "sense of urgency."  Another board member, Steve Juelsgaard, former executive vice president of Genentech, said the plan contained projects that he had never seen before in the biotech industry.

Asked for comment, CIRM board member Al Rowlett, who is chief executive officer of the Turning Point mental health program in Sacramento, said,

“It’s ambitious, but then isn’t that what the people of California were when they approved Proposition 71. They wanted to create something that was going to change the face of medicine. That’s what we hope to do….”

Proposition 71 was the ballot initiative that created the $3 billion agency in 2004. The campaign led voters to believe stem cell therapies were close on the horizon. None has been produced, and the agency's state bond funding is expected to run out in 2020.

CIRM directors later today will be briefed on a $30 million “wind-down” plan that has attracted $7 million in private donations. More funding is being sought. One source may be the state legislature.

The agency’s plan for the next five years says it would benefit the people of California by creating  “an industrial stem cell therapeutic powerhouse that expands the tax base, adds high quality jobs and increases the likelihood of the commercialization of stem cell treatments for patients with unmet needs.”

Randy Mills, CEO of the agency since May 2014, said the plan was devised to have "the greatest possible impact for our patients. We didn’t want something ‘good enough.’ We wanted something transformational."

He acknowledged the risk and size of the task, which he said is aimed at transforming regenerative medicine. But he remains optimistic that the agency’s tiny team of about 55 persons can pull it off. He gave his team full credit for developing the spending proposal. 

The CIRM plan calls for spending $620 million on clinical work and “translational” research, which is aimed at taking basic discoveries beyond the most preliminary stage. Basic research would receive $170 million. Educational programs total $50 million. Another $50 million would go for “infrastructure.” 

One of the riskier elements of the proposal may be the agency’s plan to offer $75 million to private investors to begin a partnership in which they would have access to the best of the CIRM-funded research that doesn’t already have a private partner. 

The investors, who could be a Big Pharma firm, an existing smaller company or venture capitalists, would have to add $75 million of their own money. The agency would also continue to support the selected research, thus minimizing the risk to the private investors.

For months, Mills has been commenting on the reluctance of private investors to engage in stem cell therapy development, which is expensive and novel. “De-risking” is important in attracting business interest, Mills says.

Competition for the $75 million is scheduled to begin behind closed doors early next year. But questions have been raised about the risk that no private investors would find any CIRM research attractive.

Gregory Bonfiglio, managing partner of Proteus Regenerative Medicine, a Portola Valley, Ca., a venture capital firm, said in an interview, however, such efforts by the agency are long overdue.

He said, 

“There are risks inherent in the development of new, disruptive technology. The bigger risk is failing to deliver on their underlying promise to bring new regenerative therapies to patients…. The bigger risk is not doing anything.”

Another important element of the plan involves creation of accelerating and “translating” centers, funded at $15 million each, beginning next year. The agency is also likely to expand its Alpha Clinic effort, which is aimed at providing one-stop treatment centers.

The translating and accelerating centers would work with the Alpha clinics and other researcher to provide much of the “backroom” work needed to negotiate federal rules and regulations and win ultimate approval of a therapy. 

Stem Cell Cures: Who is Going to Pay?

Money and the FDA were on the agenda today over at The Stem Cellar.

The Cellar is the blog of the $3 billion California stem cell agency, whose minions were on the scene in Atlanta for the World Stem Cell Summit.

Kevin McCormack, the agency’s senior director for communications, wrote about the FDA, only a couple of weeks after the agency took on the FDA for slowness and excessive caution. Don Gibbons, who also works in communications for the agency, wrote about the minor matter of money -- just who is going to pay for stem cell therapies.

First, the money bit, since as Gibbons points out,

“The bottom line: stem cell therapies will never be widely available if insurers won’t pay for them”

Gibbons wrote about a panel dealing with that dubious euphemism -- “reimbursement:”

“Elizabeth Powers of the IMS Consulting group suggested the audience pay close attention to the cancer market.  She said insurers and other payers of health care services are tired of paying for ‘statistically significant’ improvements in survival that only translate to a few weeks on average. She said payers are moving away from just whether a new therapy is different from prior therapies and want to be shown true value.”

Use of the word “reimbursement” is Big Pharma’s way of NOT saying that profits must be made if treatments are going to be produced. Unfortunately, the use of the term ill serves the industry by creating the impression among the public that they are being hornswoggled with jargon. The word smacks of entitlement, as if someone should guarantee the drug companies billion-dollar earnings.

McCormack focused on what he called a “clarion call” by Robert Califf, the deputy commissioner for the Food and Drug Administration (FDA), who has been with the FDA only eight months. Califf called for deeper patient involvement in drug development decisions.

McCormack also wrote,

“(Califf) says the first goal of the FDA has to be to protect the public, and that it’s hard to balance safety and innovation. ‘That’s an issue we struggle with every day.’”

McCormack did not link to the strong language concerning the FDA found in his agency’s new plan for spending $900 million over the next few years in search of a stem cell therapy.

Underlying both pieces on The Stem Cellar are two issues for the CIRM board to consider next week as it eyes the future. Does the agency, which will cost the California public roughly $6 billion including interest, want to fund research that is likely to lead to enormously expensive treatments that insurers and the federal government (via Medicare and Medicaid) will be reluctant and even refuse to pay for.

The usual argument is that prices will ultimately come down. However, we have already seen strong evidence to the contrary. The concerns have risen to the level of presidential politics and are not likely to vanish, regardless of the hopeful expectations of industry.

As for the FDA, when safety is the all-pervasive driving force of the FDA, it naturally will lead to slower action and caution on new treatments.  California’s stem cell agency, however, is looking for significant results in the next five years. Its money is running out. Cash for new awards will vanish in 2020. And the possibility of raising significant new funds is bleak if the agency cannot show major results after what will be 16 years of effort.

California Stem Cell Agency: FDA Stalling Development of Stem Cell Cures

The FDA is one of the favorite whipping boys in Washington, D.C., but it is not often that a state governmental agency also decides to thrash the body that is charged with assuring the safety of the nation’s drugs and medical treatments.

California’s $3 billion stem cell agency, however, is doing just that. As part of its new plan for spending its last $900 million, the agency is lambasting the FDA for standing in the way of speedy development of stem cell therapies.

The general chorus about the failings of the FDA is large. This morning a Google search on the term “FDA whipping boy” turned up 155,000 results. A search on the term “criticism FDA approval process” produced 569,000 results including an entire Wikipedia entry. Of course, not everyone agrees that the FDA is too stringent in its drug regulation. (See here and here.)

It should also be noted that stem cell therapies provide novel challenges, much more so than conventional, new drug offerings.

Nonetheless, here is the text of what the California Institute for Regenerative Medicine had to say about FDA in its new strategic plan, which is expected to be approved Dec. 17 in Los Angeles.

“FDA Challenges and Obstacles

“We heard a resounding chorus frommost stakeholders of the enormouschallenges with the regulatory burdensplaced on cell therapy in general, andstem cell therapy even more so, by theFDA. Instead of the ever growing bodyof work in cell therapy, with its overallexcellent safety record, making thepathway to approval smoother, it seemsto many that the requirements imposedby the FDA are increasing.

“A recent therapy touted by the FDAas a success had such a high clinicaldevelopment burden placed on it thatby the time it was finally approved,standard of care had evolved andits market was significantly reduced,leading to liquidation of the company.Companies, and sadly patients, mustgo outside the United States, as faraway as Japan, to find regulatoryagencies willing to work successfullytowards approval.

“Ultra-orphan diseases still must reachthe same statistical burden, whichrequires larger effect sizes than seenin the majority of approved, successfuldrugs and biologics. Everyone hastheir own list of how the FDA makesit seemingly impossible to take stemcell therapy through the regulatoryprocess. In 2014, Japan recognizedthe differences in regulatory approachesneeded for regenerative medicine andtook action. However, the FDA does notappear to have the same motivation. Infact, in a disturbing turn of events, FDAhas recently began providing certainmembers of the U.S. Congress withcompletely one-sided information on thedangers of cell therapies encounteredin clinical trials. However, FDA failedto provided any context or balancedinformation regarding the safety recordof cell therapies that comprises the vastmajority published clinical literature. TheFDA appears to be literally lobbyingagainst the very therapeutic modalitythey are responsible for promoting.

“CIRM needs to join with Congress,academia, and patients, to bring aboutreal change to meaningfully balancerisk-benefit in FDA regulations andmore importantly, the FDA’s behaviorand willingness to grant licensure toeffective therapies.”